Sunday, December 19, 2010

I haven't been to Blockbuster to rent a DVD in long time. I use to go once a month to use some free coupons I had, but it was less hassle and personal cost than to just get what I want from Red Box for a buck. Thus, I stopped answering surveys to get the free passes and stopped renting from Blockbuster.

Last night we all wanted to see Despicable Me. It wasn't going to be in Red Box until the middle of January. I could've waited till January, but I figured I would splurge.

I found that since it was a very new release it was going to cost $4.99. The other new releases were $2.99. I expected to be gouged by Blockbuster, but even 5 dollars was more of a gouging than I anticipated. Then I stood in line for 15 minutes or so.

As I waited I noticed a lady get up there and say that she had lost her Blockbuster card. She wanted to know if they could look her up by her name. They said they could if she had rented a video in the last three months. She had not. They then asked if she wanted to sign up for a new card. The look on her face said that she did not, but she likely had a movie her kid wanted and she had already invested 15 minutes in line, so she pulled out of line and started to fill out the paperwork.

Finally I get to the front of the line and the lady is still filling out paperwork. I was entirely ready to walk out without the movie if they told me my card was no good and I had to fill out a new form, because I hadn't used it in years, let alone in the last three months.

The card worked and then the cashier gave me a spiel about some new policies. Apparently the extra Blockbuster tax for really new releases is a new thing. Not only are they charging 2 bucks more for them, but they give you one day less with them than if it was just a regular new release. I rolled my eyes since Blockbuster is a dieing business with their current model and they do everything they can to make it unappealing to people.

With Blockbuster getting movies as soon as they hit video and charging a premium for them and with Red Box not getting them till a month later and at that point Blockbuster's price drops I have a theory about what is going on.

One could wonder why the movie companies give the new releases to Blockbuster when it is becoming more and more unpopular and Red Box is preferred by many more people. My guess is that the movie companies are going to prop up Blockbuster as long as they can since they probably charge Blockbuster and Red Box the same for the videos. Once dollar videos are the norm that give Red Box the power to negotiate lower cost from the movie companies. Of course, I also foresee Red Box prices going up at least dollar.

There is likely a piece of it where Blockbuster is has agreed to pay a higher price for the disks in order to get a x number of week exclusive.

I saw lots of merchandising in Blockbuster. The usual candy and popcorn, but also stuffed toys from movies and various things like that. A strategy that could save them might be to focus on getting people in with competitive prices on games and videos and then getting them to buy the other stuff. They don't have to deeply discount that stuff, but make them unique and not inflate the price. People would perhaps think of gifts for people and they might even get a reputation for being a good place to pick up unique movie themed gifts.

They could even have some Red Box like machines there to dispense the movies, thus making more room for merchandise and save money on employees. Another idea could be to change from being a brick and mortar business at all and switch to machines outside of partner businesses while perfecting a streaming business.

Even though streaming is much more convenient than physical media I think there will be a large market for it for a while to come. For example, streaming does not work well when traveling. A friend of mine tells of traveling across the country, picking up a video at Red Box for the kids to watch in the van and stopping at a Red Box in another state to return it when they were tired of it. They would also pick up a new one while they were there. It also works well for hotel rooms where the hotel might want to charge you a premium for on demand video. A family could go to a near by Red Box and bring a video or two back to the motel. There is also large part of the population to which streaming will be too complicated for them for years to come.

I'm kind of rambling, but the bottom line is that I had not been to Blockbuster in a long time. After my experience last night, it will be a long time again before I visit Blockbuster. I will either be patient and get what I want from Red Box or see if a friend has it and borrow it from them. Either way, Blockbuster won't get any of my money and if the movie companies keep giving exclusive to the place I don't shop and I choose the borrow from a friend option, then none of them get my money, not even the movie companies.

I'm willing to pay for a good movie, but don't make it hard for me to do so, don't charge me a tone for it, and give me movies that are worth renting. I'm so use to being disappointed in movies I watch that I don't get jazzed about rushing out to rent them and definitely don't have any desire to go to the theater to watch them at eight bucks per ticket.